Author: José Oramas

José is a journalist and translator with a keen interest in blockchain and cryptocurrencies.

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Australia Crypto News Trading

ASIC Boosts Consumer Protection Around CFD Crypto Trading in Australia

The Australian Securities and Investments Commission (ASIC) has further tightened up regulations for crypto exchanges in the country. This follows recent news of the UK’s Financial Conduct Authority (FCA) imposing certain conditions on Binance, such as reducing leveraged trading, to protect retail traders.

FCA Tames Crypto Trading in the UK

On 26 June, the UK’s FCA ordered crypto exchange Binance to halt all regulated services and stop the promotion of certain products and trading services for British citizens.

On 29 June, ASIC reduced CFD (Contracts for Difference) leveraged trading available to retail traders from 30:1 to 2:1, following earlier pronouncements of the FCA.

Of late, ASIC has been prompted to regulate trading services due to the number of Aussie crypto investors who have been defrauded by scammers posing as crypto exchanges in the country.

We are also paying careful attention to changes in CFD providers’ reported holdings of retail client money and any misclassification of retail clients as wholesale clients, which would risk denying them important rights and protections. Protecting retail investors from harm, particularly at a time of heightened vulnerability, is a priority for ASIC.

Cathie Armour, ASIC Commissioner

While the trading of cryptoassets per se isn’t regulated by financial watchdogs in Australia and the UK, CFDs do fall into that category, and crypto exchanges must abide by certain conditions to promote CFD crypto trading and other products.

Categories
Binance Crypto News

Binance UK Crypto Trading Services as Normal, Amid Regulation Scare

The UK’s Financial Conduct Authority (FCA) has ordered Binance to stop regulated activities in the country while issuing a warning to its consumers about the platform and its trading products.

The financial watchdog said the exchange had until 30 June to stop promoting any advertising and financial promotions in the country, besides preserving all records related to its UK customers to notify the FCA by 2 July.

Business as Usual for Binance Trading Services

The exchange said this wouldn’t affect the services provided on its official website, so trading services are working as usual.

This includes no changes to Binance Australia services as mentioned directly to Crypto News.

As Binance Australia is a separate entity to the UK-based Binance Markets Limited (BML), the Binance Australia platform experience remains unchanged and users can continue enjoying the Binance Australia platform as normal.

At Binance Australia we’re aware of the new challenges faced by regulators working with new exchanges in this space. We work closely with Australian regulator, ASIC, and have been AUSTRAC-registered since before our launch last year to ensure we offer a service that users can trust.

We take a collaborative approach in working with regulators and we take our compliance obligations very seriously. We are actively keeping abreast of changing policies, rules and laws in this new space.

Sam Teoh – COO, Binance Australia

And the official Binance Twitter account has clarified the situation.

Some users on Twitter said this was just more FUD from the UK. It is not the first time Binance has been the subject of rumours regarding investigations or closing of operations in certain countries. In March, for example, Binance CEO Changpeng Zhao dismissed reports that the exchange was being investigated by the US Commodity Futures Trading Commission (CFTC).

The FCA Toughens Its Stance Against Exchanges

The FCA established a registration regime for crypto exchanges in 2020, stating that only approved companies could promote their products. However, it has approved only five companies since then.

That year, Binance bought an FCA-regulated company called EddieUK to launch BML (Binance Markets Limited). Via BML, it would offer its trading services using pounds and euros.

Although BML wasn’t using FCA’s regulatory permissions, the exchange did apply to the FCA to become a registered company, later pulling that application due to “intensive engagement” from the regulatory body.

The only way to offer crypto products to UK citizens is by becoming a registered company or having a pending application with the FCA – but since Binance pulled its application, it can no longer provide any services, including spot trading.

Global Pressure on Binance

Many regulatory bodies worldwide have warned Binance about its lacking authorisation to operate in their respective countries. As a result, Binance is now under scrutiny from several regulators across Europe and North America.

We take a collaborative approach in working with regulators and we take our compliance obligations very seriously. We are actively keeping abreast of changing policies, rules and laws in this new space.

Binance spokesperson, via Reuters

The latest warning Binance received was from Japan’s Financial Services Agency (FSA), stating the firm was operating in the country despite lacking the permissions to do so.

Categories
Banking Crypto News

Tanzania’s Central Bank Says It’s Working on Adopting Cryptocurrencies

Tanzania’s central bank has made a u-turn on its decision to ban cryptocurrencies following orders from the East African country’s new president, Samia Suluhu Hassan.

Hassan, who came to power in March 2021 after the death of her predecessor, said the arrival of digital currencies in Tanzania was “inevitable” as it witnesses the emergence of blockchain technology.

Tanzania’s Central Bank

All Aboard the Crypto Train

Tanzania has become the latest country to adopt cryptocurrencies and blockchain technology after El Salvador decided to make Bitcoin legal tender earlier in June – which prompted other Latin American countries such as Paraguay and Panama to explore digital assets.

Many countries in the world have not accepted or started using these currencies. However, I would like to advise the central bank to start working on those issues. Just be prepared.

Tanzania President Samia Suluhu Hassan

In November 2019, Tanzania banned cryptocurrencies after its central bank refused to recognise them under local law, but now the bank seems to be working on the directives given, a spokesperson told Reuters.

Crypto Adoption Plans Accelerate Worldwide

Crypto adoption is on the rise, not only in Africa but worldwide. Nigeria is working to develop and implement its own CBDC by the end of the year, and Brazil, El Salvador, Paraguay, China and now Tanzania are just some of the countries accelerating their plans to embrace crypto and launch their own digital currencies.

We could soon see a handful of other countries and states racing to join the digital financial world. Even the European Central Bank has said countries that choose not to launch a CBDC could be “left out” when it comes to cross-border payments.

Categories
Australia Crypto News DeFi

Australia Urged to Launch CBDC ASAP as Digital Landscape is Changing Quickly

The rapidly changing global digital landscape means worldwide banks and regulatory bodies are looking to either regulate cryptocurrencies in their respective countries or launch their own CBDCs (Central Bank Digital Currencies).

Australia Under Pressure to Launch CBDC

While the RBA (Reserve Bank of Australia) is still researching CBDCs, other banks across the world are moving fast with their plans to launch digital currencies.

A week ago, the local government of the Chinese Xiong’an region announced it would pay its residents in digital Yuan, starting with construction workers.

The case for Australia is the back-and-forth of the RBA regarding a future CBDC, along with the unclear regulatory environment for cryptocurrencies. Unsurprisingly, many in the blockchain and crypto community in general have criticised Australian monetary authorities for not taking digital currencies seriously, something that seems to affect the banks as well.

We need to think, as a country, ‘what is crypto, how could it be used, and do you trade it?’ If it is something that should be traded safely, [how do] we make it safe? Those are the issues we need to think about, and quite quickly, because people are making a livelihood out of trading.

Ross McEwan, CEO, National Australia Bank

BIS Backing Stablecoins

The Bank of International Settlements (BIS) – dubbed the central bank for central banks – has shown support for the development of CBDCs in an attempt to modernise traditional finance and ensure “Big Tech” does not take control of money, according to a report from Reuters. 

This has rushed other banks to explore the technology of CBDCs as cryptocurrencies are booming and the world is gradually transitioning to digital payments. Further, at least 56 central banks and monetary authorities are exploring digital currencies.

Impact of Blockchain and DeFi on Traditional Finance

Australian venture capitalist Mark Carnegie recently spoke on the ABC’s The Business cryptocurrencies special about how DeFi and blockchain are changing the landscape for traditional finance.

Carnegie, who launched a crypto fund two months ago, said the idea behind cryptocurrencies is to bring on a decentralised financial world and not to focus solely on one crypto, referring to Bitcoin maximalists. When asked about the safety of DeFi, he said:

Look at the GFC [Global Financial Crisis of 2007]; in the end, the government had to step in to guarantee the world’s financial system. It’s safe because they decided to print money, it’s not safe because it’s safe, it’s because you’re essentially charged huge amounts of insurance embedded in all the fees you pay.

Mark Carnegie

Carnegie added that wholesale investors were coming into his fund looking for a mainstream fund manager willing to go into digital assets.

Categories
Bitcoin Mining Crypto Exchange

Gemini Exchange to Offset Bitcoin Carbon Emissions with Gemini Green

The Winklevoss-led Gemini Exchange has launched Gemini Green, a long-term initiative with Climate Vault that aims to remove 350,000 tonnes of CO2 emissions caused by Bitcoin mining.

This initiative is a part of a long-term strategy with Climate Vault, a non-profit founded at the University of Chicago to help decarbonise Bitcoin. As part of the plan, Gemini is buying carbon permits directly from government-regulated cap-and-trade markets to shorten the supply and remove them from circulation to prevent miners from using these permits to emit CO2. 

As Bitcoin emerges as a dominant store of value, it’s imperative that we incorporate sustainability for future generations. We are proud to team up with Climate Vault to offset our exposure to non-renewable mining and contribute to the decarbonising of Bitcoin.

Tyler Winklevoss

The Carbon Equivalent of a Billion Driving Miles

The amount of CO2 that Gemini plans to buy equals roughly a billion miles driven by an ordinary passenger automobile. Speaking about Bitcoin environmental effects, Michael Greenstone, co-founder of Climate Vault, said:

Slowing and ultimately reversing the total amount of CO2 entering the atmosphere is vital to preventing disruptive climate change. Climate Vault is providing a simpler, faster, and more reliable path to net-zero emissions, not just for traditional businesses, but now – thanks to Gemini – for the innovative world of cryptocurrency.

More crypto exchanges are vowing to go carbon neutral following environmental debates, largely initiated by Elon Musk, CEO of Tesla. After that, two leading crypto exchanges announced they would become carbon neutral, starting with the San Francisco-based FTX, stating that while there are bigger energy consumers, it is committed to reducing Bitcoin’s CO2 emissions.

BitMEX followed suit shortly after, announcing it would begin searching for organisations to partner. The company’s first step would be to donate US$0.0026 for every US$1 of blockchain fees its clients pay.

Categories
Crypto News Crypto Wallets Hackers Scams

Scam Warning: Fake Crypto Hardware Wallets Sent to Ledger Customers

Last year, hardware wallet provider Ledger suffered an internal breach of security resulting in the exposure of 250,000 to 1,000,000 customer email addresses. In some cases, the information leaked included full names and addresses. A class action is under way, but the after-effects linger.

Initial Concern Regarding Bad Actors

Since self-custody and privacy remain crypto’s greatest drawcards, the initial concern was that the information would be used by malicious actors to separate users from their crypto holdings.

Within a short space of time, Reddit users described various phishing attempts (such as links to the “latest software upgrade”) and death threats (so-called “$5 wrench attacks”). At the time, users quite reasonably began asking questions as to whether or not Ledger was a secure hardware wallet.

Unsurprisingly, once leaked private information becomes available in the public domain, the consequences are likely to linger. Ledger’s 2020 data breach is no different as the ramifications persist.

Latest Fraudster Activity

Recently, Ledger customers have revealed a new and sophisticated effort by fraudsters involving fake hardware wallets being sent to exposed Ledger customers’ addresses.

https://twitter.com/BitcoinMagazine/status/1405572965480153095

Overlooking the fact that Ledger is unlikely to ever send a “new” unsolicited hardware device to its users (much less one that is unsealed/damaged), the clear giveaway in this instance was a single use of slang in the letter:

… For this reason, we have changed our device structure. We now guarantee that this kinda [emphasis intentionally added] breach will never happen again.

Extract from fake Ledger letter

In addition to examples such as that outlined above, some users have also described fake hardware being sent with a pre-installed recovery seed:

https://www.reddit.com/r/CryptoCurrency/comments/o609v2/hardware_wallet_scam/
https://imgur.com/a/WNjlkyc

How to Avoid Getting Scammed

Unfortunately, scammers continue to thrive and innovate within the crypto space. In 2020 alone, Australians lost $26 million in Bitcoin to scams.

The good news, however, is that there are some basic principles within the domain of hardware wallets that dramatically reduce the prospects of being scammed:

  • Only buy hardware directly from the manufacturer or authorised reseller
  • Never buy a used device
  • Make sure the packaging has not been tampered with
  • When starting the device up, make sure there aren’t any error messages that could be evidence of tampering
  • Remember that no hardware wallet comes pre-installed with a 24-word recovery phrase.

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Categories
Bitcoin Mining Crypto News

Iran Seizes 7,000 Crypto Miners After Banning Mining Operations Due to Power Blackouts

A worker inspects hardware devices as illuminated mining rigs operate inside racks at the CryptoUniverse cryptocurrency mining farm in Nadvoitsy, Russia, on Thursday, March 18, 2021. The rise of Bitcoin and other cryptocurrencies has prompted the greatest push yet among central banks to develop their own digital currencies. Photographer: Andrey Rudakov/Bloomberg

Iranian officers have seized 7,000 Bitcoin mining machines operating at an illegal cryptocurrency farm located in an abandoned factory in the west of Tehran.

Temporary Halt Called on Crypto Mining

Iran has been a crypto-friendly country in recent years, mostly to outlook US sanctions and to pay for imports using cryptocurrencies. But recent power outages have pushed the government to place a temporary halt on all crypto mining until September.

In January, Iran confiscated over 1500 unlicensed crypto mining farms, seizing 45,000 mining rigs. But this latest is the largest haul in a country where cryptocurrency mining is banned temporarily due to high energy consumption causing power outages. According to blockchain analytics firm Elliptic, at least 4.5% of all BTC mining takes place in Iran due to its cheap electricity. 

Could China’s Continuous Crackdown Benefit Crypto in the Long Run?

While some countries and states are banning crypto mining, others are incentivising Bitcoin mining companies. This is a consequence of the rolling Chinese crackdown on cryptocurrencies, which has pushed miners overseas. Latin America has so far been the most welcoming continent to miners looking for alternatives.

As China accounts for 65% of the Bitcoin hashrate, miners would set up shop there due to its competitive hardware price and cheap energy. This lasted a couple of years until unclear regulatory weather set in and shook the crypto market in 2021 with China shutting down crypto mining farms in the country.

The benefit of the Chinese government shutting down mining farms is the redistributed hashrate. Bitcoin mining could become more decentralised as miners look to countries and states that can meet their conditions to mine. Mining companies are now looking to North America, Latin America and Central Asia to set up shop and pick up some of the slack.

Ending the ‘China FUD’

Other important and positive aspects of this situation are that it will end the classic “China FUD” – that China controls Bitcoin, or that miners use dirty energy to mine – and it can alleviate the market as it will discourage media channels from promoting fear and uncertainty.

El Salvador, despite international criticism from regulatory and financial models, is proceeding with its plan to develop a huge mining operation centre using the country’s geothermal energy excess.

Categories
Crypto News Institutions Investing

PayPal and Visa Bet on Blockchain Capital’s US$300 Million Fund

Blockchain Capital, one of the oldest venture capital firms focused on crypto technology, has secured US$300 million in funding with high-profile partners PayPal and Visa.

Blockchain Capital announced the close of Blockchain Capital V, LP, a fund heavily oversubscribed at its US$300 million hard cap, which saw the participation of many strategic investors, pension funds and major university endowments.

Payment Giants Investing in Crypto Companies

Blockchain Capital is a leading venture firm in the crypto industry and has previously worked with several high-profile crypto companies such as Ripple, Kraken, Coinbase, and Anchorage. On June 21, the firm -together with Morgan Stanley Tactical Value – led a US$48 million Series B funding round for Securitize, a Coinbase-backed asset tokenisation platform.

We are incredibly honoured to welcome a world-class group of investors into Fund V who appreciate the value of a firm dedicated to a single industry. As founders ourselves, we know how hard it is to build companies, protocols and, indeed, a whole new industry.

Blockchain Capital co-founder and managing partner Bart Stephens

The Fund V will be focused on DeFi (Decentralised) and NFTs (Non-Fungible Tokens) startups while avoiding the assets themselves. The firm has the decentralised NFT marketplace OpenSea as part of its portfolio.

PayPal’s Head of Crypto, Jose Fernandez da Ponte, said that investing in Blockchain Capital’s new fund allows it to connect with the entrepreneurs leading the change for the DeFi world:

PayPal is committed to fostering an ecosystem of companies making digital currencies more accessible, useful and secure. Investing in Blockchain Capital’s new fund allows us to engage with the entrepreneurs driving the future of the decentralised economy and the new wave of financial services.

Jose Fernandez da Ponte

The firm said PayPal, Visa and other Fund V investors will take part in its strategic partnership program.

Categories
Bitcoin Bitcoin Mining China Crypto News

Nvidia GPU Prices in China Fall Amid Bitcoin Mining Crackdown

Mining rigs of a super computer are pictured inside the bitcoin factory 'Genesis Farming' near Reykjavik, on March 16, 2018. - At the heart of Iceland's breathtaking lava fields stands one of the world's largest bitcoin factories at a secret location rich in renewable energy which runs the computers creating the virtual currency. (Photo by Halldor KOLBEINS / AFP)

Nvidia graphic card prices in China have fallen as much as two-thirds on Chinese e-commerce websites following the government’s crackdown on cryptocurrency mining.

As per a June 21 report by the South China Morning Post (SCMP), medium to advanced card prices fell on various e-commerce websites after Sichuan officials ordered the shutdown of several crypto mining facilities. The Nvidia Quadro P1000 model, an entry-level graphics card, was priced at 2,429 yuan (US$376) on JD.com, a popular online retailer in China.

The Asus RTX3060, which is a more advanced card, dropped from 13,499 yuan to 4,699 on June 21 on JD.com-operated online retailer site Tmall.

Mining Companies Pushed Overseas

Some miners plan to relocate from Guangzhou to US state Maryland, moving three tonnes of Bitcoin mining machines, according to a tweet from CNBC representative Eunice Yoon.

Xinjiang, Inner Mongolia and Sichuan were the three biggest provinces for crypto miners thanks to cheap electricity. But these areas have become hostile environments despite miners using hydroelectric energy instead of coal. This has pushed BTC mining companies overseas, some now looking at North America, Central Asia or South America.

One of the most attractive alternatives for miners is South America, which is becoming a mining hub as more countries follow El Salvador’s decision to make Bitcoin legal tender and facilitate BTC mining with wasted geothermal energy.

Categories
Crypto News DeFi

Mark Cuban Calls for DeFi Regulation After DeFi Token Collapses from $65 to $0.00000003

A DeFi token called TITAN has dropped to almost zero in price after suffering a bank run this week, plunging from US$65 to 0.00000003. Mark Cuban, who was staking liquidity for the token, is now asking for stablecoin regulation after losing a “small percentage” of his portfolio in the crash.

The TITAN token is part of a Stablecoin project called Iron Finance. According to the post-mortem released by the protocol, around 10am UTC on June 16, large holders began to sell, which triggered other holders to follow suit.

Price went from US$65 to almost zero following panic sell-offs. Source: Slingshot Finance

What we just experienced is the worst thing that could happen to the protocol, a historical bank run in the modern high-tech crypto space.

Iron Finance report

Cuban Calls for DeFi Regulation

Following the bank run, Cuban told Bloomberg there should be rules to determine what is a stablecoin and what level of collateralisation is acceptable. He added that part of his loss was his fault:

It is no different from the risk I take in angel investing […] The thing about DeFi is that it is all about revenue and math, and I was too lazy to do the math to determine what the key metrics were.

Mark Cuban

DeFi a Dangerous Space for Newcomers

It’s highly unlikely that regulations in the DeFi space occur as it would totally flip the idea of decentralised. However, it is a dangerous space for newcomers, especially those with a lot of capital to invest.

Many traders have lost substantial amounts of money due to mistakes such as sending funds to the incorrect address, like the DeFi trader who lost US$188,000, or being a victim of a rug pull or a hack, which have become increasingly common in the space.

One of the latest protocols to be hacked was DeFi100, which lost US$32 million in an alleged hack. However, rumours circulate that the project rug-pulled its investors.

With a Total Value Locked of over US$60 billion, more and more investors are exploring the DeFi world to take a chunk out of the high returns. However, new traders should educate themselves first and consider the risks of investing in DeFi.